Why does industry need automated Procurement Processes?
As the resources boom continues to show no sign of slowing down industry is becoming increasingly reliant upon automated processes to increase efficiencies and accountability within the procurement process. This reliance has come about because of the sheer number of projects proceeding, the shortage of people and the increasing need and insistence by clients to increase the efficiency of procurement throughput using technology.
What are the benefits?
Automated processes can reduce the administrative burden commonly associated with undertaking procurement activities and allow purchasing representatives to focus on the more strategic elements of procurement. These processes can electronically record for audit purposes event logs which detail and track phases and elements within the procurement process. These paperless processes can reduce rework and variation of work practices commonly associated with paper based or semi-automated methods.
What type of automated tool or system should a purchaser choose?
Choosing a new electronic procurement tool or system is fraught with difficulties and it is highly recommended that the purchaser firstly look at where within their procurement process they need to become more efficient and accountable to meet their client’s expectations.
As an example, a purchaser who is qualifying fabricated steel suppliers on a project should consider having an automated application and review process via a networked portal rather than retaining the information within Word and Excel on their project’s hard drive.
The Need
Once the need for an automated procurement tool or system is determined the purchaser then needs to ask the following questions before proceeding down that path:
• Does the software developer offer a trial period to enable the purchaser to test the functionality of the tool or system?
• Does the software have the functionality it claims it has?
• Will the use of this tool or system make your organisation more efficient?
• Will your company’s commercial risk be reduced by using this tool or system?
• Is the procurement process and elements it controls efficient?
• Does it offer the purchaser and their client transparency and control?
• Is the software configurable?
• Does the tool or system allow the purchaser, suppliers and the client to undertake process interaction or is it disjointed?
• Is the tool or system user friendly?
• Will procurement, engineering or operational people be able to learn how to use the tool or system quickly?
• Can the tool or system be deployed quickly?
• Does the tool or system have after sales training and service available to the purchaser?
• Are the licensing costs for the purchaser to use the tool or system either ongoing or expensive?
• Does it have appropriate information security?
• Is the software fit for purpose and developed by trained and industry active procurement managers?
• Does it use mature and well supported technology?
• Does the tool or system come with a conditional money back guarantee?
• Is there flexibity in the licensing types and the durations of the licenses?
About
Glenn Turley is a consultant with 20 year procurement experience. He undertakes work on EPC projects for clients requiring the intensive management of procurement systems, packages and people.
He has also focused for the last six years on automating procurement and materials management processes.
Contact Glenn by phone: 61 42 760 8741
Contact Glenn by email at: glenn@logcon.com.au
Logistics Consulting website site: http://www.logcon.com.au